Signal stock

Rebounds broadly on positive market mood, Fed signals further hikes

  • Asian stocks rebound strongly as DXY loses strength amid a time correction process.
  • Chinese indices are continuously gaining on the removal of tariffs on Chinese imports by the United States.
  • BOJ’s Kuroda promises more policy easing to boost growth rate.

Markets in the Asian realm are moving sharply higher as risk-sensitive currencies rebounded firmly amid a time correction in the US Dollar Index (DXY). The DXY is moderately offered in the Asian session after the asset printed a new 19-year high at 104.92 on Thursday. The asset gained popularity after the US economic agency published the annual producer price index (PPI) at 11%, above forecasts of 10.7%. Additionally, the core PPI which excludes food and energy rose to 8.8% from estimates of 8.9%.

At press time, the Japanese Nikkie225 jumped 2.45%, the Chinese A50 0.74%, the Hang Send 1.86% and the Indian Nifty50 0.8%.

Chinese markets continue to grow after the announcement of the removal of customs duties on Chinese imports by the United States. US President Joe Biden announced on Tuesday that the administration may ease some of the tariffs imposed on Chinese imports to reduce inflation. The announcement sent an adrenaline rush into Chinese indices.

Meanwhile, Japan’s Nikkie225 outperformed Asian indices on the announcement of continued prudent monetary policy by the Bank of Japan (BOJ). BOJ Governor Harihuko Kuroda sees no legitimate reason to halt the recovery of his economy. Growth rates have yet to reach pre-pandemic levels and inflation is still below target despite soaring household energy bills and food prices.